A $5.5 billion lawsuit filed by the trustee for bankrupt Taylor Bean and Whitaker Mortgage Corp. against an auditor has been settled.
Ocala, Florida-based Taylor Bean collapsed in 2009 following its suspension by the Federal Housing Administration and Ginnie Mae.
Turns out, however, that senior executives at the company had been running a massive fraud scheme involving their warehouse lender.
That warehouse lender was Colonial Bank, which itself failed shortly thereafter.
After Taylor Bean filed bankruptcy,
the trustee for the Taylor, Bean & Whitaker Plan Trust filed a lawsuit against Colonial’s independent auditor, PricewaterhouseCoopers LLP.
The complaint, filed in 2013, sought $5.5 billion.
On Friday, a settlement was reached between the plaintiff and the defendant.
Terms of the settlement weren’t disclosed.
“The case was settled to the mutual satisfaction of the parties,” PwC U.S. Public Relations Leader Caroline S. Nolan said in a written statement to Mortgage Daily.
Taylor Bean’s auditor, Deloitte & Touche LLP, reached a confidential settlement in a lawsuit filed by the bankruptcy trustee in 2013, while Bank of America Corp. settled with Deutsche Bank and BNP Paribas in 2015 for $315 million over its role as intermediary on Taylor Bean notes.
Founder and former Taylor Bean chairman Lee Bentley Farkas is serving a 30-year prison term.
